Himatsingka Seide Q2 Profit Falls 66.2% to ₹14.20 Crore

Himatsingka Seide Ltd reported Q2 FY27 consolidated net profit of ₹14.20 crore, down 66.2% year on year, as revenue from operations declined 0.8% to ₹624.52 crore for the quarter ended September 30, 2026. The result reflects a sharp fall in profit before tax despite broadly stable revenue.

What did Himatsingka Seide report for Q2 FY27?

Himatsingka Seide reported consolidated revenue from operations of ₹624.52 crore in Q2 FY27, compared with ₹629.57 crore in the corresponding quarter of the previous year. Revenue was 0.5% higher sequentially from ₹621.3 crore in Q1 FY27, indicating that sales were broadly stable on a quarter-on-quarter basis.

Total income stood at ₹668.83 crore, up 5.4% sequentially but down 5.4% year on year. Expenditure rose to ₹663.89 crore, increasing 6.0% from the preceding quarter and 3.2% from a year earlier. The company reported an operating margin of 12.08%, compared with 22.15% in Q2 FY26, according to the exchange filing summary.

Profit before tax fell to ₹4.94 crore from ₹64.0 crore in Q2 FY26, a decline of 92.3%. Consolidated net profit was ₹14.20 crore, versus ₹42.0 crore a year earlier. Earnings per share fell to ₹1.13 from ₹3.34 in Q2 FY26.

Why did reported profit differ from the pre-tax result?

Reported profit was supported by a net tax credit during the quarter, even though profit before tax weakened sharply. The quarter included a ₹24.3 crore deferred-tax credit and a ₹15.0 crore current-tax charge, resulting in a net tax credit of about ₹9.3 crore.

In Q2 FY26, the company had reported a tax charge of ₹21.8 crore. This year-on-year movement in tax treatment reduced the extent of the decline in reported profit after tax. As a result, net profit fell 66.2% year on year, while pre-tax profit declined 92.3%.

Sequentially, net profit rose 184.8% from ₹5.0 crore in Q1 FY27. However, profit before tax was lower than the ₹8.1 crore reported in the preceding quarter. The difference between the movement in pre-tax profit and net profit is relevant when assessing the quarter's operating performance.

What happened to Himatsingka Seide's margins and costs?

Himatsingka Seide's operating performance weakened as expenses rose faster than revenue. The company reported that the combined raw-material and traded-goods cost ratio was 70.1% of revenue in Q2 FY27, compared with 59.7% in Q1 FY27.

Finance costs were ₹70.5 crore and depreciation was ₹25.7 crore during the quarter. The reported operating margin of 12.08% was below the 22.15% recorded a year earlier. Net profit margin was 2.12%, compared with 3.82% in Q2 FY26.

The revenue movement was modest, but the decline in pre-tax profit shows the effect of higher costs on profitability. For investors, the sharp gap between the revenue trend and the profit trend is a central feature of the Q2 FY27 result.

What did the board approve besides the quarterly results?

Himatsingka Seide's board approved the unaudited standalone and consolidated financial results for Q2 and the first half of FY27 on November 14, 2026. The statutory auditors issued unmodified limited-review conclusions on the financial statements.

The board also approved the capitalisation of up to USD 50.06 million of receivables from Himatsingka America Inc., its wholly owned step-down subsidiary in the United States. The transaction remains subject to approval from the Reserve Bank of India and is targeted for completion within one year.

The receivables capitalisation will involve conversion of outstanding receivables into equity, with no cash consideration or share swap. The company stated that the related-party transaction would be conducted at arm's length. Separately, it issued 34,000 senior, unsecured, rated, listed, redeemable and taxable non-convertible debentures aggregating ₹34 crore through private placement, with the securities listed on BSE.

How does the Q2 FY27 result matter to investors?

The Q2 FY27 numbers show that Himatsingka Seide maintained revenue close to the previous year's level, but profitability was materially lower. Revenue was down only 0.8% year on year, whereas profit before tax declined 92.3%, highlighting pressure from expenditure and margins.

The tax credit limited the reported fall in net profit, but it did not alter the lower pre-tax profit. Investors assessing the result may therefore focus on cost movements, operating-margin recovery and the execution of the receivables capitalisation, which still requires RBI approval.

The board's approval of the subsidiary receivables transaction is also material because it concerns up to USD 50.06 million of outstanding balances. The company has disclosed that the transaction involves a wholly owned step-down subsidiary and will be undertaken on an arm's-length basis, subject to the required regulatory approval.

Conclusion

Himatsingka Seide's Q2 FY27 result combined nearly flat revenue with substantially lower profitability. Consolidated revenue was ₹624.52 crore and net profit was ₹14.20 crore, while the year-on-year decline in pre-tax profit was far steeper than the decline in reported profit after tax because of a net tax credit in the quarter.

The next disclosed item to watch is RBI approval for the proposed capitalisation of up to USD 50.06 million in receivables from Himatsingka America Inc. The company has targeted completion of the transaction within one year, while future quarterly results will provide further evidence on costs, margins and profit trends.